Back when I was in school teachers would always scare me with stories of how my exploits would end up in my permanent record. I believe this is it! – Geoff Fox

I Am Not An Economist

Let me repeat the title of this entry: I am not an economist. I’m just making sure no one is confused that I might have some expertise as a I ponder the plight of Wal-Mart.

To call Wal-Mart the world’s largest retailer is to underplay their significance in our economy and the economy of the rest of the world. They are the 500 pound gorilla. It’s not tough to look past them – it’s impossible.

Don’t let Wal-Mart’s country bumpkin beginnings fool you. This is one sophisticated retailer. Everything that’s sold in any Wal-Mart store is accounted for within a few minutes on massive computers at their Bentonville, Arkansas headquarters. Wal-Mart distribution system is second to none. Stores are restocked, items are re-ordered with minimal human intervention.

With all this going in Wal-Mart’s favor the revelation that their Christmas season sales lag the rest of the retail sector is stunning&#185. What’s going on?

Is it possible that Wal-Mart has become a victim of the recent spate of bad publicity surrounding the retailer’s practices? Within the last year there has been labor unrest in Southern California where other stores blamed their problems on Wal-Mart’s wage and insurance policies. Then CNBC and Frontline (PBS) both did long form documentaries on Wal-Mart – not all positive. Then there’s the objections raised in many communities when Wal-Mart came to town.

A backlash – even a small backlash would be enough to account for what’s going on. Meanwhile we still have 3 weeks until Christmas and it’s possible that Wal-Mart can make up what they’ve lost.

It will be interesting to watch.

&#185 – It should be noted that early season data is very sparse but some credit card numbers have shown an exceptional growth in sales.

2 thoughts on “I Am Not An Economist”

As a former Wal-Mart employee (1989-1998)I cannot say many good things about the company. I began as a part-timer, and our store manager would occasionally send us home 15 or 20 min. after we arrived at work, because payroll had to be cut that day. Most of my years were spent as a photo lab manager, and almost every week I worked far more than my salaried 48 hours. Once I worked 19 hours straight to catch us up (I figured that was my fault, since I had promoted us too much to my traveling group during a trip to Australia)—but, sad to say, true dedication is rarely ever acknowledged. The bottom line is all they ever care about—to the point of driving their best and brightest away.

Re Walmart. Forbe’s “billionaire list”, has Walmart family members as 6th through 10th, making them worth as a family about 100 billion. That’s twice as much as Bill Gates. While downtowns have been decimated by chains, it’s hard not to approve lower prices for people especially poorer people. There is not a preponderance of Escalades, BMWs, Volvo’s or Mercedes in the Walmart parking lots. It’s not an easy answer, but neither is it all bad nor all good.